operating program summary - toronto...the 2015 operating budget of $8.400 million gross and ($0.007)...

Contents

Overview

I: 2015–2017 Service Overview and Plan 6

II: 2015 Budget by Service N/A

III: Issues for Discussion 18

Appendices:

1. 2014 Performance 21

2. 2015 Operating Budget by Expenditure Category 23

3. 2015 Organization Chart 24

4. Summary of 2015 Service Changes N/A

5. Summary of 2015 New & Enhanced Service Changes N/A

6. Inflows/Outflows to / from Reserves & Reserve Funds 25

7. 2015 User Fee Rate Changes 27

OPERATING PROGRAM SUMMARY

Arena Boards of Management 2015 OPERATING BUDGET OVERVIEW

The Arena Boards of Management are 8 Board-managed arenas that offer ice contracts, programming, and pleasure skating to the community. Some arenas also offer dry floor rentals in the summer. These services are complemented with snack bars, pro-shops, and meeting room rentals at some locations.

2015 Budget Highlights

The total cost to deliver this service to Toronto residents in 2015 is $8.400 million as shown below.

2014 2015 Change

(in $000's) Budget Budget $ %

Gross Expenditures 8,167.6 8,400.4 232.8 2.9%

Gross Revenues 8,263.4 8,407.2 143.8 1.7%

Net Expenditures (95.8) (6.8) (89.0) 92.9%

In 2015, the Arena Boards will increase its expenditures by $0.233 million, driven by labour cost increases, inflationary adjustments, and non-labour expenditure adjustments. The Program will increase its revenue by $0.144 million driven by increased user fee revenues and sundry revenues. As a result, the Arena Boards Program will have a budgeted net surplus at $0.007 million in 2015.

toronto.ca/budget 2015

Key Performance Measure – Hours Available for Ice Rental

Hours Available for Ice Rental

50,00 0

48,00 0

46,00 0

44,00 0

42,00 0

40,00 0

38,00 0

36,00 0

2012 Actual

2013 Actual 2014 Proj. 2015 Target 2016 Target 2017 Target Actual

Trends

Steady number of available ice hours for the next 3 years for all arenas. George Bell and Leaside Garden Arenas now operational with summer ice and second ice pad respectively thus adding additional hours since 2014.

Declining growth in sundry revenue (proshop and snack shop) across all Arenas due to strong commercial competition.

Prime-time usage rate has risen by 2.8% and non prime-time usage rate has risen by 4.3% in 2014.

2015 Operating Budget Arena Boards of Management

Fast Facts Our Service Deliverables for 2015

The Arena Boards of Management are responsible for providing ice time, in-house programming, and accessory services to individual users, community groups, and private groups.

The 2015 Operating Budget will fund:

A total of 46,121 hours of available ice time, comprising of 25,590 hours of prime time ice and 20,531 hours of daytime ice, to the community across the eight Arenas.

Ongoing delivery of in-house programs such as house leagues, hockey schools, summer camps, and learn-to-skate programs.

Provision of accessory services such as snack bar, vending machines, pro shop, skate sharpening, and meeting/banquet hall facility rentals.

Full capacity operation of prime time ice for all Arena Boards.

11 ice rinks, including 9 large rinks and 2 small rinks.

5 of 8 Arena Boards will offer year- round ice rentals.

5 of 8 Arena Boards offer meeting room rentals to the general public.

All 8 arenas offer proshop and snack bar services.

In 2014, all arenas operated at full capacity, delivering 24,022 primetime and 20,531 non prime-time ice bookings.



2015 Operating Budget Expenses & Funding

Where the money goes:

2015 Budget by Service

$8.4 Million

TedReeve, George Bell,

$938, 11% $669, 8%

North Toronto, Forest Hill,

$988,12% $1,150, 14%

MossPark, $854, 10%

$8.4 Million

McCormick, $725, 9% Leaside

Bill Bolton, $1,138,13%

Gardens, $1,937, 23%

2015 Budget by

Expenditure Category Service & Contribution

Contribution Rent, $1,032, toCapital,

$8.4 Million

toReserves /12% $560,7%Equipment, Reserve $44,0% Funds,$270,

3%

Materials& Supplies,

$2,147, 26%

Salaries& Benefits,

$4,348, 52%

Where the money comes from:

2015 Budget by Funding Source

Sundry & Other

Revenues,

UserFees &

$1,024, 12%

$8.4 Million

Donations, $7,383, 88%

Our Key Challenges & Priority Actions

Revenue Decline at Leaside Gardens Arena

In 2014, the Arena faced challenges overcoming disruptions caused by onsite constructions on its sundry revenues and banquet hall usage, and committing to its first full year of debt repayment obligations.

The 2015 Operating Budget includes increased advertising and promotion expenses in order to support recovery of its revenues.

George Bell Arena Summer Ice Service

The Arena will actively promote the availability of its new summer ice service which first opened in 2014. Summer ice costs/revenues will be separately tracked.

2015 Operating Budget Highlights

The 2015 Operating Budget of $8.400 gross and ($0.007) million net will provide funding to:

Program specific expenditures such as purchases for snack bar and proshop, and zamboni contributions.

Administration and operation expenditures including permanent staffing costs, utilities, accounting fees, and office expenses.

Repairs and maintenance expenditures including ice refrigeration and resurfacer costs, and facility repairs.



Coun cil Approved Budget

City Council approved the following recommendations:

1. City Council approve the 2015 Operating Budget for Arena Boards of Management of $8.400 million gross, ($0.007) million net for the following services:

Gross Net Service: ($000s) ($000s)

George Bell Arena 669.2 0.0 William H. Bolton Arena 1,138.5 (0.8)

Larry Grossman Forest Hill Memorial Arena 1,150.4 (1.2)

Leaside Memorial Community Gardens Arena 1,936.9 (3.5)

McCormick Playground Arena 725.2 (0.2)

Moss Park Arena 854.3 (0.1)

North Toronto Memorial Arena 988.4 (0.9)

Ted Reeve Arena 937.6 (0.0)

Total Program Budget 8,400.4 (6.8)

2. City Council approve the 2015 Service Levels for the Arena Boards of Management as outlined on page 7 of this report, and associated staff complement of 66.6 positions;

3. City Council approve the 2015 market rate user fee changes for Arena Boards of Management identified in Appendix 7 for inclusion in the Municipal Code Chapter 441 “Fees and Charges”-and

4. City Council approve the 2015 new user fees for Leaside Garden and George Bell Arena Boards of Management as identified in Appendix 7b (New User Fees) for addition to the Municipal Code Chapter 441, User Fees and Charges.


Part I: 2015 – 2017 Service Overview and Plan


Program Map



2015 Service Deliverables

The 2015 Operating Budget of $8.400 million gross and ($0.007) million net for Arena Boards of Management will fund:

A total of 46,121 hours of available ice time, comprising of 25,590 hours of prime time ice and 20,531 hours of daytime ice, to the community across the eight Arena Boards.

Ongoing delivery of in-house programs such as house leagues, hockey schools, summer camps, and learn-to-skate programs.

Provision of accessory services such as snack bar, vending machines, pro shop, skate sharpening, and meeting/banquet hall facility rentals.

Full capacity operation of prime time ice for all Arena Boards.

2015 Service Levels Arena Boards of Management

Activity Sub-Activity/Type

Service Level

2015

Ice Booking Prime Time 100% Utilization

Non Prime time 60% Utilization (on average)

Facility Rental Banquet hall / Meeting / Board Rooms 76% Utilization / Occupancy

Arena Floor 100% On Demand

Indoor Swimming Pool 100% Utilization / Occupancy

Concession / Vending Snack Bar 66% staffed and open - 100% on demand

Pro Shop 100% on demand

Directly Run (Programmed) Recreational Skate / Shinny 100% of programmes are evaluated to respond

to Community needs

Camps 100% of programmes are evaluated to respond

to Community needs

Hockey Schools 100% of programmes are evaluated to respond

to Community needs

Summer / Winter Hockey Leagues 100% of programmes are evaluated to respond

to Community needs

Learn to Skate 100% of programmes are evaluated to respond

to Community needs

Indirectly 3rd party

Coordinated(Booking)

To maintain annual contracts for 3rd party

groups

The 2015 Service Levels are unchanged from the approved 2014 Service Levels.



Service Performance Efficiency Measure – Total Cost Per Hour of Available Ice Time

Efficiency

Total Cost Per Hour of Available Ice Time

$250

$225

$200

$175

$150

$125

$100

$75

$50

$25

$0 George

Bell Bill Bolton¹ Forest Hill² Leaside³ McCormick⁴ Moss Park

North Toronto

Ted Reeve

2012 Actual $141.37 $200.61 $243.69 $167.79 $76.78 $164.16 $156.84 $163.24

2013 Actual $170.11 $201.62 $212.71 $160.58 $77.67 $166.01 $172.06 $165.40

2014 Proj. Actual $128.79 $225.48 $217.62 $212.97 $77.65 $161.40 $191.85 $169.18

2015 Target $129.13 $235.47 $224.77 $214.37 $80.93 $168.04 $184.91 $178.02

2016 Plan $132.97 $232.37 $233.13 $214.37 $80.93 $172.13 $190.72 $179.70

2017 Plan $136.96 $232.37 $239.62 $214.37 $80.93 $174.92 $190.72 $180.90

1 Bill Bolton Arena, which is located in a residential setting, is not able to operate ice in the late night. This results in fewer hours and higher cost per hour calculations. 2 Forest Hill Arena has one large and one small ice pad, but only the large pad operates year -round and is used to calculate hours of available ice, leading to larger cost per hour calculations. 3 Leaside Arena began its first full-year of operationson the second ice rink in 2014, thus leadingto higher cost per hour in the future years. 4 McCormickArena has one large and one small ice pad, both of which operate year-round and are used to calculate hours of available ice, leading to significantly lower cost per hour calculations

The efficiency measure “Total Cost Per Hour of Available Ice Time” is derived from the total operating costs of an arena divided by the hours of ice time available to be booked.

The cost per hour of ice time generally increases every year due to inflation and labour cost increases. Other fluctuations can be caused by arena closures for renovations, emergency shutdown due to emergency repairs, or quantity and dollar values of small repairs and maintenance projects undertaken by an Arena Board.

George Bell Arena began its summer ice operations in 2014, resulting in increased available ice hours and a decreased cost per hour projection in years from 2015 to 2017.



The 2015 Operating Budget and 2016 and 2017 Plan for Bill Bolton Arena include one-time provision of consultant fees, WSIB Premium and adjusted expenditures to reflect actual. As a result, the cost per hour is higher.

Efficiency Measure – Revenue Per Hour of Available Ice Time

Efficiency

Revenue Per Hour of Available Ice Time

Reeve

$250

$225

$200

$175

$150

$125

$100

$75

$50

$25

$0 George

Bell Bill Bolton¹ Forest Hill² Leaside³ McCormick⁴ Moss Park

North Toronto

Ted

2012 Actual $142.39 $195.99 $244.71 $144.84 $74.81 $163.43 $157.07 $157.20

2013Actual $170.37 $185.88 $212.99 $137.28 $77.69 $166.09 $172.57 $163.05

2014Proj. Actual $128.81 $225.48 $217.90 $215.36 $77.67 $161.41 $191.98 $160.94

2015 Target $129.13 $235.64 $225.00 $214.83 $80.96 $168.06 $185.09 $169.50

2016Plan $132.97 $233.06 $233.39 $214.83 $80.96 $172.15 $190.89 $172.84

2017Plan $136.96 $233.54 $239.93 $214.83 $80.96 $172.15 $190.89 $176.77

1 Bill Bolton Arena, which is located in a residential setting, is not able to operate ice in the late night. This results in fewer hours and higher revenue per hour calculations. 2 Forest Hill Arena has one large and one small ice pad, but only the large pad operates year-round and is used to calculate hours of available ice, leading to larger revenue per hour calculations 3 Leaside Arena began its first full-year of operations on the second ice rink in 2014, thus leading to higher revenue per hour in the future years. 4 McCormick Arena has one large and one small ice pad, both of which operate year-round and are used to calculate hours of available ice, leading to significantly lower revenue per hour calculations

The efficiency measure “Revenue Per Hour of Available Ice Time” is derived from the total revenue of an arena divided by the hours of ice time available for booking. Fluctuations in revenues could be due to arena closures for renovations, variable sales revenues from ancillary operations, and one-time revenues from film shoots.

Since the first year of summer ice operations in 2014, George Bell Arena was able to increase available hours of ice thus leading to lower revenue per hours calculations. Revenue per hour is expected to increase in the future years as available ice is marketed to the community and filled at improved levels.



Leaside Gardens Arena has begun its first year of operations of the second ice pad in 2014. With the additional revenue, the revenue per available ice hours has increased in 2014 and it will further increase as the usage rate is projected to improve significantly in years from 2015 to 2017.

Effectiveness Measure – Cost Recovery Percentage

Effectiveness

Cost Recovery Percentage

Reeve

105%

100%

95%

90%

85%

80% George

Bell Bill

Bolton Forest

Hill Leaside McCormick

Moss Park

North Toronto

Ted

2012Actual 100.7% 97.7% 100.4% 89.4% 97.4% 99.6% 100.1% 100.1%

2013Actual 100.2% 92.2% 100.1% 87.9% 100.0% 100.0% 100.3% 99.9%

2014Proj. Actual 100.0% 100.0% 100.1% 101.0% 100.0% 100.0% 100.0% 100.0%

2015Target 100.0% 100.1% 100.1% 100.2% 100.0% 100.0% 100.0% 100.0%

2016Plan 100.0% 100.3% 100.1% 100.2% 100.0% 100.0% 100.0% 100.9%

2017Plan 100.0% 100.5% 100.1% 100.2% 100.0% 98.4% 100.0% 102.1%

A key mandate of the Arena Boards is to manage and operate the arenas (a City-owned asset) effectively and efficiently at no cost to the City. The goal is to generate sufficient revenue to fund operations.

The effectiveness measure "Cost Recovery Percentage" is derived from the total revenue of an arena divided by its total expenditure, and indicates how each arena is performing and whether it is meeting its mandate. Arenas that break even or generate net surpluses require no operating budget support; net operating surpluses become part of the City's general revenues. Arenas that incur net operating deficits require funding from the City.

Fluctuations can be caused by unanticipated demand changes for ice rentals or in-house programs, revenues from accessory operations (changes in snack bar/vending and pro shop sales and facility space rental revenue), advertising, one-time revenues, and the quantity and dollar value of repairs and maintenance projects.

Bill Bolton Arena did not achieve cost recovery in 2012-2013 due to a backlog of maintenance and repair needs. Bill Bolton Arena expects its cost recovery rate to stabilize at 100% and above in years 2014 to 2017.




Leaside Arena did not achieve full cost recovery in 2012 due to an unexpected refrigeration repair expense and lost revenues due to construction of the new ice pad and in 2013 due to the construction.

All eight Arena Boards expect to break even or produce a small net surplus in 2014, at 100% or higher cost recovery percentages. The 2015 Operating Budget for the Arena Boards indicates that they will reach break-even net budget or generate a net surplus for the year.

Utilization Measure – % Usage of Prime Time Available hours

Prime Time Ice Utilization % Usage of Prime Time Available Hours

Reeve

100.0%

90.0%

80.0%

70.0%

60.0%

50.0% George

Bell BillBolton ForestHill Leaside McCormick

Moss Park

North Toronto

Ted

2012Actual 92.8% 98.0% 97.2% 100.0% 96.7% 94.8% 96.0% 96.3%

2013Actual 100.0% 98.0% 96.2% 55.7% 96.7% 94.8% 96.0% 96.3%

2014Proj. Actual 90.5% 98.0% 96.2% 85.5% 96.7% 94.8% 96.0% 96.3%

2015Target 90.6% 98.0% 96.2% 85.5% 96.7% 94.8% 96.0% 96.3%

2016Plan 90.7% 98.0% 96.2% 85.5% 96.7% 94.8% 96.0% 96.3%

2017Plan 90.7% 98.0% 96.2% 85.5% 96.7% 94.8% 96.0% 96.3%

------- IndustryBenchmark=96%

Prime Time Ice Utilization reflects the percentage of available prime time hours that is booked and used. The industry benchmark for prime time ice utilization is 96% booked for a standard ice season.

This measure varies from year to year based on market demand. Six arenas expect to surpass the industry benchmark of 96% for prime time ice utilization in 2015.

In 2013, Leaside Gardens Arena experienced a lower utilization rate as a result of construction of the second ice pad. Leaside Gardens Arena anticipates prime ice time utilization rate to recover in 2015 and after. However, the rates will perform below the industry benchmark as the Arena lost ice booking and banquet hall rental revenues due to construction and must rebuilt its usage levels.

In 2014, five of eight arenas will offer year-round ice operations (George Bell, William H. Bolton, Forest Hill, McCormick, and Moss Park). Their prime time ice utilizations reflect the total of the standard Fall/Winter Ice Season plus the Spring and Summer ice seasons' prime time hours sold versus availability.

In 2014 and thereafter, George Bell !rena’s prime time ice utilization rate will decline as a result of new summer ice being filled at lower levels. George Bell Arena reported that summer ice is generally more difficult to fill than winter ice.


Utilization Measure – % Usage of Non-Prime Time Available hours

Non-Prime Ice Utilization % Usage of Non-Prime Available Hours

100.0%

Reeve

90.0%

80.0%

70.0%

60.0%

50.0%

40.0%

30.0%

20.0% George

Bell BillBolton Forest Hill Leaside McCormick

Moss Park

North Toronto

Ted

2012 Actual 49.1% 70.2% 92.6% 69.9% 40.3% 74.6% 87.0% 63.6%

2013Actual 50.5% 70.2% 87.4% 29.6% 40.3% 74.6% 87.0% 62.8%

2014Proj.Actual 47.1% 69.5% 87.4% 64.5% 40.3% 74.6% 87.0% 62.8%

2015Target 47.1% 69.5% 87.4% 64.5% 40.3% 74.6% 87.0% 62.8%

2016Plan 47.1% 69.5% 87.4% 64.5% 40.3% 74.6% 87.0% 62.8%

2017Plan 47.1% 69.5% 87.4% 64.5% 40.3% 74.6% 87.0% 62.8%

-------- IndustryBenchmark=25%-40%

Non-prime time ice time is generally defined as daytime and late night ice times during weekdays (Mondays to Fridays 7:00 a.m. to 4:00 p.m. and 11:00pm to 1:00am).

The industry benchmark for non-prime ice utilization ranges from 25% to 40% average rental for the standard ice season for a good arena.

All eight arenas have been meeting or surpassing the industry benchmark of 25-40% for non-prime time ice utilization, and expect to continue to do so in the near future.

McCormick Arena's 40% utilization of non-prime ice time represents a composite figure for the two ice surfaces combined, one large and one small ice rink, and meets the industry benchmark. The small rink is difficult to rent out at the best of times, and during the day there is little demand for the small ice surface except for shinny and practices.

Leaside !rena’s non-prime ice utilization rate dropped significantly in 2013 to 29.6% due to the addition of the second ice pad and the disruption caused by the construction. Leaside Arena expects to return to its normal utilization rate levels in 2014 and thereon.

All eight Arena Boards actively market daytime ice to the local community.


2014 2015 Operating Budget Incremental Change 2016 and 2017 Plan

2015 vs. 2014

Approved Actual 2015 2015 2015 Budget Approved

Budget Base New/Enhanced Budget Changes 2016 2017

(In $000s) $ $ $ $ $ $ % $ % $ %

Gross Expenditures

George Bell Arena 699.6 669.0 669.2 669.2 (30.4) (4.4%) 19.9 3.0% 20.7 3.0%

William H. Bolton Arena 1,090.2 1,090.1 1,138.5 1,138.5 48.3 4.4% (15.0) (1.3%)

Larry Grossman Forest Hill Memorial Arena 1,113.8 1,132.5 1,150.4 1,150.4 36.6 3.3% 42.8 3.7% 33.2 2.8%

Leaside Memorial Community Gardens 1,900.6 1,835.0 1,936.9 1,936.9 36.3 1.9%

McCormick Playground Arena 695.7 713.3 725.2 725.2 29.4 4.2%

Moss Park Arena 820.5 786.4 854.3 854.3 33.8 4.1% 20.8 2.4% 14.2 1.6%

North Toronto Memorial Arena 953.9 909.1 988.4 988.4 34.5 3.6% 32.6 3.3%

Ted Reeve Arena 893.3 925.5 937.6 937.6 44.3 5.0% 15.3 1.6% 9.6 1.0%

Total Gross Expenditures 8,167.6 8,005.5 8,400.4 8,400.4 (74.7) (0.9%) 4.6 0.1% 11.1 0.1%

Revenue

George Bell Arena 699.6 669.4 669.2 669.2 (30.5) (4.4%) 19.9 3.0% 20.7 3.0%

William H. Bolton Arena 1,105.2 1,010.6 1,139.3 1,139.3 34.1 3.1% (12.5) (1.1%) 2.4 0.2%

Larry Grossman Forest Hill Memorial Arena 1,115.2 1,134.9 1,151.6 1,151.6 36.4 3.3% 42.9 3.7% 33.5 2.8%

Leaside Memorial Community Gardens 1,978.8 1,755.5 1,940.4 1,940.4 (38.4) (1.9%)

McCormick Playground Arena 695.9 706.2 725.4 725.4 29.4 4.2%

Moss Park Arena 820.6 787.2 854.4 854.4 33.8 4.1% 20.8 2.4%

North Toronto Memorial Arena 954.5 909.2 989.3 989.3 34.8 3.6% 32.6 3.3%

Ted Reeve Arena 893.5 926.0 937.6 937.6 44.1 4.9% 23.5 2.5% 22.0 2.3%

Total Revenue 8,263.4 7,899.0 8,407.2 8,407.2 (74.6) (0.9%) (3.6) (0.0%) (1.3) (0.0%)

Net Expenditures

George Bell Arena (0.0) (0.4) 0.0 0.0 0.0 (100.1%) (0.0)

William H. Bolton Arena (15.0) 79.5 (0.8) (0.8) 14.2 (94.4%) (2.5) 294.6% (2.4) 73.6%

Larry Grossman Forest Hill Memorial Arena (1.4) (2.5) (1.2) (1.2) 0.2 (15.1%) (0.1) 10.9% (0.3) 20.6%

Leaside Memorial Community Gardens (78.3) 79.5 (3.5) (3.5) 74.8 (95.5%)

McCormick Playground Arena (0.2) 7.1 (0.2) (0.2) 0.0 (0.0%)

Moss Park Arena (0.1) (0.8) (0.1) (0.1) (0.0) 26.0% 0.0 (5.2%) 14.2 100.7%

North Toronto Memorial Arena (0.6) (0.1) (0.9) (0.9) (0.3) 47.5% 0.1 (6.4%)

Ted Reeve Arena (0.2) (0.5) (0.0) (0.0) 0.2 (86.7%) (8.2) (12.4) 99.7%

Total Net Expenditures (95.8) 106.4 (6.8) (6.8) 89.1 (92.9%) 8.2 (121.0%) 12.4 220.2%

Approved Positions 67.4 67.4 66.6 66.6 (0.8) (1.2%)



Table 1

2015 Operating Budget and Plan by Service

The Arena Boards of Management 2015 Total Operating Budget is $8.400 million gross and ($0.007) million net. The Net Budget decreased by $0.089 million or 92.9% due to the following:

Leaside Gardens Arena is facing challenges around the aftermath of construction which negatively affected the banquet hall rentals and sundry revenue at the Arena. The total revenue is expected to decline by $0.038 million while total expenditures are expected to increase by $0.036 million in 2015.

Bill Bolton Arena is planning for a one-time expense to engage a consultant in 2015 to perform a general facility review to identify any major issues with the Arena's operation. A total of $0.015 million is allocated for consultant fees.

Leaside Gardens and McCormick Arenas are maintaining their budget the same as the 2015 level in the 2016 and 2017 Plan years.


Approval of the 2015 Operating Budget will result in Arena Boards of Management reducing its total staff complement by 0.83 positions from 67.4 to 66.57, as highlighted in the table below:

Table 2

2015 Total Staff Complement

Changes

2015 Budget Plan

Total 2016 2017

2014 Approved Complement 67.4 66.6 66.6

In-year Adjustments

Adjusted 2014 Staff Complement

Change in Staff Complement

67.4 66.6 66.6

Prior Year Impact

Operating Impacts of Completed Capital Project

Capital Project Delivery

Base Changes (0.8)

Service Changes

New / Enhanced Service Priorities

Total 66.6 66.6 66.6

Position Change Over Prior Year (0.8)

% Change Over Prior Year (1.23%)

The Program’s total staff complement will decrease by 1.23% or 0.83 complement primarily as a result of the following changes:

George Bell Arena has reduced its 2015 Total Staff complement by 0.83. The Arena expects less activity in its snack shop area and will require less staff to operate.


Total

2015 Base

(In $000s) Budget

Gross Expenditure Changes

Prior Year Impacts

N/A

Operating Impacts of Capital

N/A

Economic Factors

Inflationary Adjustments 36.9

COLA and Progression Pay

Salaries, Benefits, COLA and Other Adjustments 152.7

Other Base Changes

Expenditure Adjustments 22.4

Bill Bolton - HR Contingency, Water, Snackbar, Zamboni Adj. 20.8

Total Gross Expenditure Changes 232.8

Revenue Changes

Base Revenue Rate Changes 150.9

Sundry Revenue Adjustments (7.1)

Total Revenue Changes 143.8

Net Expenditure Changes 89.0


The 2015 Operating Budget includes base expenditure pressures of $0.233 million net, primarily attributable to salary and non-salary inflationary increases which have been partially offset by $0.144 million net in base revenue adjustments as detailed below:

Table 3 Key Cost Drivers

Key cost drivers for Arena Boards of Management are as follows:

All 8 Arenas are expecting to increase labour costs by the cost of living adjustment rate of 2.25% in accordance with the City's guideline.

In addition, Bill Bolton Arena is adjusting staff compensation rates to the market levels in an effort to strengthen employee retention.

Bill Bolton Arena is increasing its expenditures by $0.015 million for a one-time consultant cost, a one-time adjustment to its contribution to vehicles reserve – ice resurfacer, and water charges based on higher usage.


2016 - Incremental Increase 2017 - Incremental Increase

Gross Net % # Gross Net % #

Description ($000s) Expense Revenue Expense Change Positions Expense Revenue Expense Change Positions

Anticipated Impacts:

Economic Factors 35.3 35.3 2.0% 26.8 26.8 0.9%

Non-Union Progression Pay, COLA and Fringe Benefits 73.1 73.1 1.7% 59.8 59.8 1.4%

Other Expenditure Adjustments 8.0 8.0 (9.0) (9.0)

User Fee Revenues 105.7 (105.7) 1.4% 72.5 (72.5) 1.0%

Sundry Revenues 21.5 (21.5) 2.1% 6.0 (6.0) 0.6%

Sub-Total 116.4 127.1 (10.7) 77.6 78.5 (0.8)

Total Incremental Impact 116.4 127.1 (10.7) 77.6 78.5 (0.8)


Table 6

2016 and 2017 Plan by Program

Approval of the 2015 Base Budget for the Arena Boards of Management will result in a 2016 incremental net surplus of $0.011 million and a 2017 incremental net surplus of $0.001 million to maintain the 2014 service levels and $8.168 million respectively.

Future year incremental costs are primarily attributable to the following:

Anticipated Impacts

Inflationary cost increases to utilities, snack bar supplies and telephone expenses are projected to be $0.035 million in 2016 and $0.027 million in 2017.

Every year, each Arena Board will review the performance of its non-unionized staff and budget for salary increases for cost-of-living adjustments and progression pay at no more than the City's increases for management/non-union staff. The non-union salary increases for the Arena Boards are estimated to be $0.073 million in 2016 and $0.060 million in 2017.

User fee increases of $0.106 million and $0.073 million are planned for 2016 and 2017 respectively based on an approximate average 3.7% increase for all 8 arenas. These reflect the newly adjusted market-based user fee rates being recommended in 2015.

Sundry revenue is expected to increase by $0.022 million in 2016, and $0.006 in 2017 mostly driven by higher planned activity levels with snack bar and proshop sales at most of the Arenas.


Part III: Issues for Discussion


Issue s for Discussion Issues Impacting the 2015 Budget

Leaside Arena Expansion Project: First Full Year of Operations

Leaside Arena's new ice pad became operational in October 2013, one month later than planned due to construction delays. Despite the delay, the Arena was able to continue regular ice operations at the start of the ice season in September by renting the Angela James Arena from Parks, Forestry, and Recreation (PF&R).

The Loan Agreement between the City, Infrastructure Ontario, and the Board of Management of Leaside Arena requires that interim payments, including payroll costs to the City, be kept up to date. For the loan to remain in good standing, it is necessary that the Arena settles its financial obligations on a timely basis, including making timely repayments to the City for the one-time rental of the Angela James Arena, ongoing payroll payments, and debt repayment instalments.

As of 2014, all required loan payments have been made.

Actual revenues and expenditures to operate the new ice pad will be reported through the City's quarterly variance reporting process.

Leaside Arena's 2015 Operating Budget, 2016 Plan and 2017 Plan project net surpluses of $0.004 million in each year demonstrating the Arena's ability to commit to the loan repayments while adhering to The Loan Agreement between the City, Infrastructure Ontario and the Board of Management of Leaside Arena.

George Bell Arena's New Summer Ice Service

George Bell Arena has been experiencing lower than budgeted revenue levels in recent years. This was the result of the departure of a major client in September 2012, whose ice time the Arena Board was only able to replace at lower rates, as well as a decreasing trend in demand for snack bar services. In order to operate at no net cost to the City, the Arena Board had been postponing non-urgent maintenance and repair work for several years.

On June 11, 2013, City Council approved a $0.100 million loan to George Bell Arena for the purpose of installing a high-capacity dehumidifier such that the Arena Board could operate ice in hot and humid summer weather and generate a new revenue stream from summer ice operations. See report titled "George Bell Arena Board Expanded Service" (EX32.15). The loan principle and interest was amortized over five years beginning with repayment in 2014.

The 2015 Operating Budget and 2016 and 2017 Plans for George Bell Arena include loan repayments due to the City while meeting the net expenditure target of zero.



Core Se rvice Review – Status Update

At the Special City Council Meeting of September 26 and 27, 2011, City Council adopted the following recommendation emanating from the Core Service Review (EX10.1):

8(o). Arenas (Directly Operated and Board Operated): Consider examining the existing business and governance models currently in place at all arenas (internally operated arenas and all 8 arena boards)."

Council on November 13, 2013, considered an Ombudsman's report titled "Skating on Thin Ice: an Investigation into Governance at an Arena Board" (CC41.4) with a directive given to the City Manager to adopt the recommendations contained in the Ombudsman's Report:

Recommendation 4 - the City Manager to examine various governance models and service delivery mechanisms for arena boards, and provide advice on options for Council’s consideration by June 2015.

Recommendation 5 - the Strategic and Corporate Policy division to clarify and communicate the role of elected representatives on Arena Boards as part of the Board orientation.

Responses to these Council requests are still outstanding.


Appendices:

2014

2012 2013 Approved 2014 2014 Approved Budget vs.

Actuals Actuals Budget Actuals Actual Variance

($000s) $ $ $ $ $ %

Gross Expenditures 6,566.5 7,186.1 8,167.6 8,005.5 (162.1) (2.0%)

Revenues 6,440.7 7,026.9 8,263.3 7,899.0 (364.4) (4.4%)

Net Expenditures 125.8 159.2 (95.7) 106.4 202.2 (211.1%)

Approved Positions 64.5 67.2 67.4 67.4


Appendix 1 2014 Service Performance

2014 Key Service Accomplishments

In 2014, Arena Boards of Management accomplished the following:

All eight arenas operated at full capacity, delivering a combined total of 24,022 hours of primetime ice bookings or 93.9% usage rate and 20,531 hours of non-prime time ice bookings or 64.3% usage rate. Prime ice usage rate has risen by 2.8%, and non-prime ice usage rate has risen by 4.3% in 2014.

All eight arenas' 2013/2014 and 2014/2015 Fall/Winter Ice Season prime time ice allocations were in compliance with the City's Ice Allocation Policy.

2014 Financial Performance

2014 Budget Variance Analysis

2014 Experience

The Arena Boards of Management reported net over-expenditure of $0.202 million for the year ended December 31, 2014. Leaside Gardens and Bill Bolton Arenas were the significant drivers of the net over-expenditures totalling $0.253 million, offset by small under-expenditures at Forest Hill, McCormick, Moss Park and North Toronto Memorial:

Leaside Gardens Arena's net o ver-expenditure of $0.158 million was primarily attributed to completion of the onsite construction related t o the new ice pad negatively affecting the ice revenue, sundry revenue and banquet h all usage in the first half of the year. These net over-expenditures were partially offset by under-spending of $0.066 million on snack bar and materials purchases, and utilities.

Bill Bolton Arena's net o ver-expenditure of $0.095 million is driven by lower than expected ice program revenue and sundry revenue which are partially offset by lower materials and snack bar purchases. Bill Bolton Arena incurred unanticipated expenses of $26,000 for emergency building repairs, and $30,000 related to one-time human resources costs.



Impact of 2014 Operating Variance on the 2015 Budget

Leaside Gardens Arena has decreased its revenue levels in 2015 by $0.038 million to reflect its 2014 actual experience.

Bill Bolton Arena has included $0.015 million for a consultant to assist in addressing current operational issues at the facility. After the brine pump has been replaced, further examinations will take place and to identify additional maintenance requirements.



Appendix 2 2015 Operating Budget by Expenditure Category

Program Summary by Expenditure Category

Category of Expense

($000's)

2012

Actual

2013

Actual

2014

Budget

2014

Actual*

2015

Budget

2015Change from

2014Approved

Budget

Plan

2016 2017 $ $ $ $ $ $ % $ $

Salaries andBenefits 3,741.1 4,259.3 4,185.1 4,110.7 4,348.5 163.4 3.9% 4,421.6 4,481.4

Materials andSupplies 1,968.3 1,667.5 2,082.6 2,025.9 2,147.2 64.6 3.1% 2,189.1 2,209.7

Equipment 35.4 39.8 40.1 39.4 43.5 3.4 8.5% 46.0 43.0

Services & Rents 642.9 869.2 1,031.5 1,001.6 1,031.5 1,043.2 1,043.4

Contributions to Capital 15.7 165.7 562.0 562.0 559.5 (2.5) (0.4%) 546.4 546.4

Contributions to Reserve/Res Funds 161.4 184.5 265.9 265.9 270.2 4.3 1.6% 270.5 270.6

OtherExpenditures Interdivisional Charges

TotalGrossExpenditures 6,564.7 7,186.1 8,167.2 8,005.5 8,400.4 233.2 2.9% 8,516.8 8,594.4 Interdivisional Recoveries

ProvincialSubsidies

FederalSubsidies

Other Subsidies

User Fees & Donations 5,548.3 6,127.6 7,271.2 6,983.8 7,382.9 111.7 1.5% 7,488.6 7,561.1

Transfers fromCapital Fund

ContributionfromReserve Funds

ContributionfromReserve 51.7 SundryRevenues 890.6 847.6 992.2 915.2 1,024.2 32.1 3.2% 1,045.7 1,051.7

RequiredAdjustments

Total Revenues 6,438.9 7,026.9 8,263.4 7,899.0 8,407.2 143.8 1.7% 8,534.3 8,612.8

Total Net Expenditures 125.8 159.2 (96.2) 106.4 (6.8) 89.5 (93.0%) (17.5) (18.4)

Approved Positions 64.5 67.2 67.4 67.4 66.6 (0.8) (1.2%) 66.6 66.6 * Note: Categories of expense are allocated and reported based on best available estimates.


Exempt

Senior Professional &

Category Management Management Clerical Union Total

Permanent 8.0 28.5 7.0 43.5

Temporary 19.1 4.0 23.1

Total 8.0 47.6 11.0 66.6

Arena Boards of Management

Leaside William H. Forest Hill

George Bell Memorial McCormick Moss Park Ted Reeve Bolton Memorial Arena Gardens Arena Arena Arena Arena Arena

Arena

Manager (1) Manager (1) Manager (1) Manager (1) Manager (1) Manager (1) Manager (1) Manager (1)

Perm (3.5) Perm (4) Perm (5) Perm (7) Perm (4) Perm (4) Perm (4) Perm (4)

Temp(1.07) Temp (3.3) Temp (3.8) Temp(4.0) Temp (2.0) Temp(1.7) Temp (2.7) Temp (4.5)

North Toronto Arena


Appendix 3 2015 Organization Chart

2015Complement


Projected Withdrawals (-) / Contributions (+)

Reserve / Balance as of

Reserve Fund Dec. 31, 2014 2015 2016 2017

Reserve / Reserve Fund Name ($000s) Number $ $ $ $

rojected Beginning Balance 49.7 49.7 144.7 134.7

rena Boards of Management Ice Resurfacer XQ1705

eplacement Reserve

roposed Withdrawls (-) (105.0) (108.0)

ontributions (+) 95.0 95.0 95.0

otal Reserve / Reserve Fund Draws / Contributions 49.7 144.7 134.7 121.7

ther Program / Agency Net Withdrawals & Contributions

alance at Year-End 49.7 144.7 134.7 121.7

Reserve / Projected Withdrawals (-) / Contributions (+)

Reserve Fund Balance as of 2015 2016 2017


rojected Beginning Balance 83.3 83.3 166.3 249.2

easide Memorial Community Gardens Arena

ebt Service Reserve Fund XR3216

roposed Withdrawls (-)

ontributions (+) 83.0 83.0 83.0

otal Reserve / Reserve Fund Draws / Contributions 83.3 166.3 249.2 332.2

ther Program / Agency Net Withdrawals & Contributions

alance at Year-End 83.3 166.3 249.2 332.2


Appendix 6 Inflows/Outflows to/from Reserves & Reserve Funds

Table 1

Program Specific Reserve / Reserve Funds

P

A

R

P

C

T

O

B

P

L

D

P

C

T

O

B




Reserve Fund Dec. 31, 2014 2015 2016 2017


Projected Beginning Balance 21,307.7 21,307.7 962.3 (8,707.9)

Insurance Reserve Fund XR1010

Proposed Withdrawls (-)

Contributions (+) 87.2 87.6 87.6

Total Reserve / Reserve Fund Draws / Contributions 21,307.7 87.2 87.6 87.6

Other Program / Agency Net Withdrawals & Contributions (20,432.6) (9,757.8) 1,237.8

Balance at Year-End 21,307.7 962.3 (8,707.9) (7,382.5)



Reserve Fund Dec. 31, 2014 2015 2016 2017


Projected Beginning Balance 44,678.1 44,678.1 41,072.9 41,212.5

Sick Leave Reserve Fund XR1007

Proposed Withdrawls (-)

Contributions (+) 5.0 5.0 5.0

Total Reserve / Reserve Fund Draws / Contributions 44,678.1 5.0 5.0 5.0

Other Program / Agency Net Withdrawals & Contributions (3,610.3) 134.7 1,374.5

Balance at Year-End 44,678.1 41,072.9 41,212.5 42,592.0


Table 2

Corporate Reserve / Reserve Funds


2014 2015 2016 2017

Market

Approved Adjusted Other Budget

Rate Description Service Fee Category Fee Basis Rate Rate Adjustment Rate Plan Rate Plan Rate Fall/Winter Ice Season: Ice

Time Rental: Adult Prime Time:

5pm to 11pm weekdays; 7am to

11pm weekends George Bell Arena Market Based Hour $269.40 $269.40 $8.08 $277.48 $285.80 $294.37

Fall/Winter Ice Season: Ice

Time Rental: Youth Prime Time:

5pm to 11pm weekdays; 7am to

11pm weekends George Bell Arena Market Based Hour $209.77 $209.77 $6.29 $216.06 $222.54 $229.22


Time Rental: Weekday Non-

Prime Time Morning: 7am to

5pm Weekdays George Bell Arena Market Based Hour $118.30 $118.30 $3.55 $121.85 $125.51 $129.28


Time Rental:

Weekday/Weekend Non-Prime

Time Evening: after 11pm George Bell Arena Market Based Hour $229.05 $229.05 $6.87 $235.92 $243.00 $250.29

Facility Space Rental : Meeting

Room Rental: one hour

meeting room rental George Bell Arena Market Based Hour $51.50 $51.50 -$1.50 $50.00 $51.50 $53.05

Program: Adult Leagues Bill Bolton Arena Market Based Participant $440.00 $440.00 $25.00 $465.00 $465.00 $465.00

Program: Learn to Skate Bill Bolton Arena Market Based Participant $125.00 $125.00 $5.00 $130.00 $130.00 $130.00

Program: Learn To Skate

(Children - Beginners):

Teaching Children (Beginners)

to skate Bill Bolton Arena Market Based Participant $100.00 $100.00 $5.00 $105.00 $105.00 $105.00

Program: Boys and Girls House

League Hockey Bill Bolton Arena Market Based Participant $305.00 $305.00 $15.00 $320.00 $320.00 $320.00

Program: Women's Education:

Teaching Hockey Skills (for a

10 week session) Bill Bolton Arena Market Based Participant $135.00 $135.00 $7.00 $142.00 $142.00 $142.00


Time Rental: Daytime ice: 7:00

a.m. to 4:00 p.m. Bill Bolton Arena Market Based Hour $110.00 $110.00 $5.00 $115.00 $115.00 $115.00

Fall/Winter Ice Season: Non-

prime time ice rental: 4:00 pm

to 5:00 pm Bill Bolton Arena Market Based Hour $160.00 $160.00 $8.00 $168.00 $168.00 $168.00


Time Rental: Prime time ice:

5:00 pm to 10:30 pm Mon. -

Fri.; and Weekends: Sat. and

Sun. all day. Bill Bolton Arena Market Based Hour $215.00 $215.00 $11.00 $226.00 $226.00 $226.00

Board room rental Bill Bolton Arena Market Based Hour $40.00 $40.00 $2.00 $42.00 $42.00 $42.00

Large Ice Surface: Prime Time

Ice Rental: Primetime: 4:00 pm

to 1:00 am; Mon - Fri Forest Hill Arena Market Based Hour $194.69 $194.69 $8.85 $203.54 $203.54 $203.54

Large Ice Surface: Ice Time

Rental: Weekend: 7:00 am to

1:00 am; Sat - Sun Forest Hill Arena Market Based Hour $194.69 $194.69 $8.85 $203.54 $203.54 $203.54


Appendix 7a User Fees Adjusted for Market and Other


2014 2015 2016 2017

Market


Rate Description Service Fee Category Fee Basis Rate Rate Adjustment Rate Plan Rate Plan Rate Small Ice Surface: Non-Prme

Time Ice Rental: Daytime: 7:00

am to 4:00 pm; Mon - Fri Forest Hill Arena Market Based Hour $106.19 $106.19 $106.20 $106.20 $106.20

Small Ice Surface: Ice Time

Rental: Primetime: 4:00 pm to

1:00 am; Mon - Fri Forest Hill Arena Market Based Hour $150.44 $150.44 $7.08 $157.52 $157.52 $157.52

Small Ice Surface: Ice Time

Rental: Weekend: 7:00 am to

1:00 am; Sat - Sun Forest Hill Arena Market Based Hour $150.44 $150.44 $7.08 $157.52 $157.52 $157.52

Prime Time Ice Rental Leaside Gardens Arena Market Based Hour $339.00 $339.00 $12.78 $351.78 $351.78 $351.78

Day Time Ice Rental Leaside Gardens Arena Market Based Hour $148.60 $148.60 $6.00 $154.60 $154.60 $154.60

Large Ice Pad: Prime time:

After 4:00 pm; Mon - Fri McCormick Arena Market Based Hour $194.69 $194.69 $4.43 $199.11 $199.11 $199.11

Large Ice Pad: Primetime:

Weekends (Sat & Sun); all

hours McCormick Arena Market Based Hour $194.69 $194.69 $4.43 $199.11 $199.11 $199.11

Small Ice Pad: Prime time: After

4:00 pm; Mon - Fri McCormick Arena Market Based Hour $128.32 $128.32 $4.42 $132.74 $132.74 $132.74

Small Ice Pad: Primetime:

Weekends (Sat & Sun); all

hours McCormick Arena Market Based Hour $128.32 $128.32 $4.42 $132.74 $132.74 $132.74

Large Ice Pad: Daytime: 7:00

am to 4:00 pm; Mon - Fri McCormick Arena Market Based Hour $97.35 $97.35 $4.42 $101.77 $101.77 $101.77

Small Ice Pad: Daytime: 7:00

am to 4:00 pm; Mon - Fri McCormick Arena Market Based Hour $79.65 $79.65 $4.42 $84.07 $84.07 $84.07

Non-prime time ice rental:

Daytime: 7:00am to 4:00pm

Mon-Fri Moss Park Arena Market Based Hour $126.00 $126.00 $9.00 $135.00 $135.00 $135.00

Prime time ice rental: 4pm to

12am Mon-Fri; 8am-12am Sat-

Sun Moss Park Arena Market Based Hour $200.00 $200.00 $14.00 $214.00 $214.00 $214.00

Non-prime time: 12am to 8am

Mon-Sun Moss Park Arena Market Based Hour $152.00 $152.00 $13.00 $165.00 $165.00 $165.00


8:00am to 4pm Mon-Fri for 3

Skaters + a Coach Moss Park Arena Market Based Hour $70.00 $70.00 $10.00 $80.00 $80.00 $80.00

Prime time ice rental: Mon -

Fri: 5:00 pm to 12:00 midnight

(Regular Rate) North Toronto Arena Market Based Hour $244.10 $244.10 $7.33 $251.43 $251.43 $251.43

Prime time ice rental: Sat &

Sun: 6:00 am to 12:00 midnight



Appendix 7a - Continued User Fees Adjusted for Market and Other


2014 2015 2016 2017

Market


Rate Description Service Fee Category Fee Basis Rate Rate Adjustment Rate Plan Rate Plan Rate Non-prime time ice rental:

Mon - Fri: 4:00 pm to 5:00 pm



Daytime: Mon - Fri: 6:00 am to

8:00 am (Regular Rate) North Toronto Arena Market Based Hour $162.29 $162.29 $4.87 $167.16 $167.16 $167.16


Daytime: Mon - Fri: 8:00 am to

4:00 pm (Regular Rate) North Toronto Arena Market Based Hour $150.83 $150.83 $7.55 $158.38 $158.38 $150.83


Private Ice: Mon - Fri: 8:00 am

to 4:00 pm (Private Ice - max. 6

skaters; excludes holidays and

PD days) North Toronto Arena Market Based Hour $70.00 $70.00 $0.00 $70.00 $70.00 $70.00

Prime Time Ice Rental: Mon. -

Fri. 6:00 pm to 11:00 pm; Sat.

7:00 am to 9:00 pm; and Sun.

7:00 am to 11:00 pm. Ted Reeve Arena Market Based Hour $203.54 $203.54 $26.55 $230.09 $230.09 $230.09

Non-prime time: Saturday

Nights, after 9 pm Ted Reeve Arena Market Based Hour $165.00 $165.00 $3.00 $168.00 $168.00 $168.00

Non-prime time: Weekdays:

prior to 8:00 am; Mon - Fri Ted Reeve Arena Market Based Hour $114.16 $114.16 $2.80 $116.96 $116.96 $116.96


8:00 am to 2:00 pm; Mon - Fri Ted Reeve Arena Market Based Hour $93.81 $93.81 $2.65 $96.46 $96.46 $96.46


2:00 pm to 5:00 pm; Mon - Fri Ted Reeve Arena Market Based Hour $132.74 $132.74 $3.66 $136.40 $136.40 $136.40


5:00 pm to 6:00 pm; Mon - Fri Ted Reeve Arena Market Based Hour $164.60 $164.60 $5.31 $169.91 $169.91 $169.91

Prime time: Sunday to Friday

after 11 pm Ted Reeve Arena Market Based Hour $179.65 $179.65 $2.65 $182.30 $182.30 $182.30

Ice time rental: Pre-Season

Prime time (Summer July -

August) Ted Reeve Arena Market Based Hour $202.66 $202.66 $6.34 $209.00 $209.00 $209.00

Ice time rental: Tryout Ice (at

end of ice season) Ted Reeve Arena Market Based Hour $202.66 $202.66 $6.34 $209.00 $209.00 $209.00


Appendix 7a - Continued User Fees Adjusted for Market and Other


2015 2016 2017

Budget

Rate Description Service Fee Category Fee Basis Rate Plan Rate Plan Rate Ice Time Rental - Girls Hockey: Prime

Time George Bell Arena Market Based Hour $186.72 $192.32 $198.09

Ice Time Rental: School Games Non-

Prime George Bell Arena Market Based Hour $121.85 $125.51 $129.27

Summer Ice Rental George Bell Arena Market Based Hour $216.06 $222.54 $229.22

Thursday Program: Free Skating

11:30am-12:30pm Leaside Gardens Arena Market Based Person $0.00 $0.00 $0.00

Thursday Programs: Adult Shinny:

12:30pm-1:30pm Leaside Gardens Arena Market Based Person $7.08 $7.08 $7.08

Spruce Grove Investment Boardroom Leaside Gardens Arena Market Based 4 Hours $100.00 $100.00 $100.00


Appendix 7b New User Fees


operating program summary - toronto...the 2015 operating budget of $8.400 million gross and ($0.007)...

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